How Tesla Disrupts the Auto Infotainment Supply Chain

A $69,900 plus price tag is a lot to pay for a car, but Tesla tries to give a lot in return. For those seeking a viable all-electric alternative, the Tesla Model S with an 85-kWh battery offers over 220 miles of emissions-free driving after a charge. As a top-tier luxury sports car sedan, its sleek design befits that of a Jaguar or Aston Martin. Performance car enthusiasts appreciate the burst of all-electric power that almost silently catapults you from a standstill to 60 mph in less than six seconds—while the electronically assisted steering allows you to command the machine when taking it up past the 100 mph mark.

But the one standout feature that carmakers are paying close attention to is Tesla's voice-controlled infotainment system, the focal point of which is a very large and beautiful 17-inch display in the middle of the dashboard. More like a smart phone and tablet interface when compared to even the most high-end car infotainment alternatives, Tesla's system also represents an opportunity for carmakers that seek to offer a similar infotainment experience–but for a more affordable BOM.

“Automakers are not necessarily copying Tesla, but the Model S represents a disruption,” Mark C. Boyadjis, an analyst for IHS Automotive, told EBN.

Tesla's design approach for its infotainment system as well as for the overall design of the car was more like that of a Silicon Valley company startup compared to a traditional car maker. Instead of relying on traditional tier-1 suppliers to design and make the Model S' infotainment system, Tesla did much of the design work itself—like Apple does for its iPhone–while outsourcing the production to contract manufacturing firms.

Tesla also “spent almost as much time designing the infotainment system as they did the car itself,” says Boyadjis, and in doing so, it did not rely on traditional tier-one suppliers such as Harman, Panasonic, Denso, or Delphi for its infotainment build. “For Tesla, Nvidia is a tier-one supplier,” says Boyadjis. “It's not just the design, but how they manufactured the infotainment system and the supply chain they used is totally different.”

In IHS Automotive's analysis of Tesla's Model S, IHS recently wrote that its teardown “confirmed that the Tesla Model S is unlike anything else on the road it found.”

According to the teardown report, Tesla's infotainment system consists of:

  • a huge 17-inch display and touchscreen, “which is much larger than the average automotive infotainment interface;”
  • an Nvidia Tegra 3, 1.4-GHz quad-core processor that offers “computing power in the same league with recent smart phone and tablet designs;”
  • an automotive head unit design that is the most complex that the “IHS Teardown Analysis Service has ever seen,” with more than 5,000 discrete components;
  • a bill of materials (BOM) for the virtual instrument cluster and the premium media control unit “that is roughly twice the cost of the highest-end infotainment unit examined by IHS.”

Inside Tesla's infotainment box, other carmakers are following Tesla's lead. For a chipset that powers the display, for example, Audi and BMW have selected Nvidia for some of their high-end models.

Since the launch of the Tesla Model S, Ford, Volkswagen, and Audi have begun to adopt a similar supply chain and development strategy for their infotainment systems. “However, Tesla is pretty much the only manufacturer to do this on a whole infotainment system level, whereas other OEMs only opt for this approach for components of their infotainment platform,” said Boyadjis.

Ford developed most of its MyFord Touch system, for example, in-house while it relied on contract manufacturers for the system “because it clearly wasn't going to build those in their factories,” said Boyadjis. “However, for SYNC 3 (Ford's newest iteration of infotainment), they have opted to partner much closer with Panasonic and QNX for the development, which ideally, will net them an easier-to-use system.”

Audi and VW are also moving “in this direction,” said Boyadjis. “They have built a consortium of suppliers and partners that work in conjunction on global infotainment system development for all of their cars,” he added. “Some of the expertise stays in house, and some of it comes along for the ride, but it's collaborative, under the watchful eye of the OEM.”

While using traditional tier-1 suppliers for the development of their infotainment system, carmakers are also seeking to offer the smart phone-like and usability features that Tesla's screen offers.

Renault, for example, offers a tablet-sized display that, like Tesla's, is in portrait mode (which is much larger vertically than traditional screens are) in its Espace crossover minivan that is launching in Europe this month. The Volvo XC90 and Porsche 918 offer portrait-mode displays and Toyota and Qoros will offer the design as well, said Boyadjis.

“Many OEMs are looking at portrait-mode displays, as opposed to a landscape orientation that almost every other infotainment system has, as a way to improve the usability of their touchscreen systems,” said Boyadjis. “It has that orientation that offers usability advantages and is something that Tesla started.”

As a way to cut costs, other carmakers are trying to offer a portrait-like screen interface by using two smaller landscape displays. Examples of recently introduced models with dual horizontal displays include the Infiniti Q50 and the Honda Acura RLX.

When interviewed, carmakers, of course, will hardly ever admit to attempting to copy or imitate Tesla's infotainment experience. However, Tesla's influence should continue to influence infotainment well into the future. “Automakers are not copying Tesla, but it represents a disruption,” said Boyadjis.

1 comment on “How Tesla Disrupts the Auto Infotainment Supply Chain

  1. michaelmaloney
    August 23, 2018

    You know, this car is really starting to resemble a mobile entertainment room what with all of the media and infotainment that's being chucked into it. I mean of course it's the latest and the coolest gadget for anybody to own, not to mention eco-friendly since it's electric and all, but it's really starting to feel more like an appliance of a swiss-army knife to me at the moment. I really just need a car to get me from point A to B isn't it?

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